The SEC should consider alternative standards for accredited investors, such as requiring a minimum level of liquid investments or the use of an investment advisor, according to a new GAO study.

Currently, the SEC lets people invest in private placement deals if they have $200,000 in household income or $1 million in wealth.

Beginning in 2014, the regulator is mandated by the Dodd-Frank financial reform act to review the definition of “accredited investor” every four years.

The last time the standard was changed was in 1982.

In its report, the U.S. Government Accountability Office, the investigative arm of Congress, said increasing the $1 million personal wealth threshold to $2.3 million to account for inflation would decrease the number of households qualifying as accredited investors by more than half, from 8.5 million to 3.7 million.

An angel investor group told the researchers that such a drop in accredited investors would harm company start-ups by limiting the pools of investors and capital.

Traditionally, the Commission has justified limiting private placements to wealthy, knowledgeable investors because these investments tend to be illiquid, complex and devoid of its review for fraud and errors.

Roughly 90% of the 27 financial advisors, broker-dealers, lawyers and accredited investors surveyed told the GAO it would be feasible to raise the income and net worth standards and about half of them said the move would increase investor protection.

In response to the report, SEC Director of Corporation Finance Keith Higgins said the agency would “factor in” the GAO’s recommendations for the accredited investor standards review.